SECURITIES AND EXCHANGE COMMISSION
DENVER, COLORADO
LITIGATION RELEASE NO. 16128 \ April 29, 1999
Securities and Exchange Commission v. Richard Carlos Powelson,
individually and dba PBS Trust, Roger Frederick Kline, and Bryan
Paul Shortsleeve, (M.D. Fla., Civil No. 98-949-CIV-T-23F)
The Commission announced today that it has obtained
injunctions against two promoters of a get-rich-quick real estate
infomercial investment scheme that raised over $1 million from at
least 15 elderly investors. Richard C. Powelson, of Kansas City,
Missouri, who did business under the name PBS Trust, and Roger F.
Kline, of St. Petersburg, Florida, were permanently enjoined from
making fraudulent offers and sales of securities on April 23, and
April 16, 1999, respectively, by Judge Steven D. Merryday of the
United States District Court for the Middle District of Florida.
Powelson and Kline consented, without admitting or denying the
Commissionís allegations, to entry of the injunctions against
violations of the anti-fraud provisions of Section 17(a) of the
Securities Act of 1933, Section 10(b) of the Securities Exchange
Act of 1934, and Rule 10b-5.
The Commissionís complaint, filed on May 5, 1998, alleges
that between October 1994 and April 1996, Powelson, Kline and
others sold investment contracts to raise money to pay for the
production and televising of an "infomercial" that encouraged
viewers to subscribe to Powelsonís get-rich-quick course on real
estate investments. Powelson, Kline, and others promised returns
of at least 150 percent in six to eight months from the on
projected sales of 300,000 real estate courses claiming that
Powelson had achieved great past successes with similar
infomercials. Such representations were baseless, according to
the Commission, because Powelson had never before produced an
infomercial, and ones in which he had appeared as a speaker were
not successful. Further the defendants failed to disclose that
Powelson had previously filed for personal bankruptcy and had
been barred from real estate transactions with the Department of
Housing and Urban Development.
The Commissionís claims against Bryan Shortsleeve, another
defendant also from St. Petersburg, Florida, are pending.